Chart Signals: USD soars, following hawkish FOMC comments

Comments from Fed Chair Yellen and Vice-Chair Fischer sparked a lot of trading action to finish last week which could continue into this week. In particular, USD soared on increasing speculation of a September rate hike. Asia Pacific currencies like JPY, SGD, AUD and NZD were hit particulary hard on the news. A number of RSI 50 crosssing and tests indicate a significant change in momentum is underway.

Comments from Fed Chair Yellen and Vice-Chair Fischer sparked a lot of trading action to finish last week which could continue into this week. In particular, USD soared on increasing speculation of a September rate hike. Asia Pacific currencies like JPY, SGD, AUD and NZD were hit particulary hard on the news. A number of RSI 50 crosssing and tests indicate a significant change in momentum is underway.

 

Asia Pacific indices

Australia 200 continues to roll over, slipping back under 4,500 and testing 4,485 a Fibonacci level with next potential support near 5,455 then 5,425. RSI breaking under 50 signals momentum turning downward.

Hong Kong 50 finished last week just above 23,000 trading in a 22,680 to 23,200 range. RSI trending back down toward 50 indicates upward momentum weakening.

Japan 225 looks vulnerable having broken 16,410 former channel support but then bouncing up off the 50-day average near 16,300 back up toward 16,570. RSI on 50 indicates neutral momentum with a downturn possible.

 

North American and European Indices

US 30 has started to roll over, falling from near 18,500 toward a test of 18,360 before finishing last week near 18,400. RSI broke under 50 to signal a downturn in momentum. Next potential support at the 50-day average near 18,280.

US NDAQ 100 remains stuck below 4,800 near 4,775 with a double top looking increasingly established near 4,845. RSI falling toward 50 indicates a correction underway with next potential support near 4,740 then 4,690.

US SPX 500 is still rolling over with its range falling to 2,160-2,180 but it managed to finish the week near 2,172. Next support possible at the 50-day average near 2,145. RSI falling toward 50 where a break would confirm the start of a downturn.

UK 100 is holding support near 6,800 following a bear trap washout under that level Thursday which appears to have completed a recent correction. Initial resistance on a rebound possible near 6,880 then 6,960.

Germany 30 is bouncing around 10,500 in the 10,490 to 10,530 area with next resistance near 10,645 and next support near 10,385. Falling RSI indicates upward momentum slowing but a golden cross confirms underlying uptrend intact.

 

Commodities

Gold continues to trend downward after a bounce off $1,320 toward $1,340 failed at a lower high and the price completed a round trip back down. RSI remains below 50 indicating continued downward pressure. Next support near $1.310 then a Fibonacci cluster near $1,295.

Crude Oil WTI tried to rally on Friday but saw gains contained near $47.80 short of the $48.20 level needed to call off an Evening Star formation. Support in place near $46.20 then $45.90 and $45.00.

 

FX

US Dollar Index has broken through 95.00 and out of a downtrend with RSI regaining 50 confirming an upturn in momentum. The index has advanced on 95.60 with next potential resistance at the 50-day average near 95.75 then 96.00 and 96.50.

EURUSD faltered near $1.1275 and dropped back under $1.1200 with next potential support in the $1.1150 and $1.1100 area where the 50 and 200-day averages cluster. RSI testing 50 where a break would signal a downturn.

GBPUSD continues to struggle with resistance at its 50-day average near $1.3275 and the 23% retracement level near $1.3315. The pair dropped back toward $1.3125 but remains in an uptrend above $1.3000 round number support.

NZDUSD is coming off a bearish key reversal and outside day which saw it complete an ascending triangle and rally up toward $0.7375 before getting hammered back toward $0.7225 as USD rallied. Next potential support near $0.7195 a Fibonacci level then the 50-day average near $0.7160.

AUDUSD is starting to break down falling toward a test of its 50-day average and uptrend support line after getting seriously rejected at $0.7700. RSI falling under 50 signals momentum turning downward. Next potential support near the $0.7500 round number.  

USDSGD is breaking out of a downtrend blasting up off its 50-day average near $1.3480 and rallying toward $1.3600 with next potential resistance near $1.3640 then $1.3740. Rising RSI confirms upward momentum increasing.

USDJPY is starting to turn upward rallying up off 100.00 toward 101.80 with support rising toward 101.50 and next potential resistance at the 50-day average near 102.75. RSI testing 50 where a breakout would confirm the upturn.

GBPJPY continues to steadily recovery, clearing 133.00 and advancing on 133.80 with next potential resistance near 135.00 and then 135.95 a 23% retracement of the post-Brexit vote selloff. RSI testing 50 where a breakout would confirm the start of a new uptrend.

EURJPY keeps quietly creeping higher nearing 114.00 with a breakout over the 50-day average near 114.65 and a breakout of the RSI over 50 needed to confirm the start of a new uptrend.

CADJPY has bounced up off 77.50 towarrd 78.40 with next potential resistance at the 50-day average near 79.00. RSI indicates downward pressure nearly gone and an upturn pending

USDCAD took another run at the $1.3000 round number and Fibonacci resistance but once again has failed to break through but RSI regaining 50 suggests a breakout remains possible with next potential resistance near $!.3055. Support rises toward $1.2970 from $1.2890.